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terminating Financial Advisor (DFA)
Old 05-01-2004, 06:45 PM   #1
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terminating Financial Advisor (DFA)

I am thinking of terminating my financial advisor who manages my portfolio for a 1% fee. The only reason I am doing this is to save the fee. He uses a lot of the DFA funds. What will happen with DFA funds if I take over the portfolio? Will he have to sell them first?

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Re: terminating Financial Advisor (DFA)
Old 05-02-2004, 03:32 AM   #2
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Re: terminating Financial Advisor (DFA)

Hello oldcrowcall. You don't need another reason.
Saving 1% on even a modest portfolio is huge.
Sometimes I go to great lengths to squeeze out
another quarter point.

BTW, my High Yield Bond Fund charges me .88%
but it's on a relatively small part of my total
investments. Only time will tell if I think they are
worth it.

John Galt
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Re: terminating Financial Advisor (DFA)
Old 05-02-2004, 08:18 AM   #3
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Re: terminating Financial Advisor (DFA)

Thanks for the answer but my question was about the DFA funds. If they are only for an investment advisor will they make me sell the DFA funds if I don't have a professional advisor?

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Re: terminating Financial Advisor (DFA)
Old 05-02-2004, 12:25 PM   #4
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Re: terminating Financial Advisor (DFA)

I don't know the answer, but if I had someone charging me 1%, I'd expect him to answer questions of that nature. I'd also expect him to shine my shoes, mow my lawn, and call me "sir".
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Re: terminating Financial Advisor (DFA)
Old 05-02-2004, 02:43 PM   #5
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Re: terminating Financial Advisor (DFA)

I terminated my financial advisor earlier this year, who also had me in DFA funds.

They had opened up a Chas. Schwab account with my initial investment in the DFA funds. When I turned the IA loose, I was told that I could retain the funds in the Schwab account; they would just remove their name from the account and it would be mine to manage.

Unfortunately, based on bogus information I got from Vanguard, I tried to transfer the account holdings "in kind" to Vanguard IRA. Because the Vanguard account was NOT managed by an investment advisor, I was not allowed to retain the DFA was all converted to cash. Luckily this was an IRA account and no tax was due on the considerable gains.

If you look at the Morningstar information about the DFA funds, you'll find they are available to the retail public, as long as your initial investment is $2 million.

My guess is that you may be able to keep them where they are, but never be able to add to the holdings or even reinvest the dividends, if the account is not "managed" by an IA.

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